Multicolor dots that randomly appear

This first started last week, i have had windows 7 for about 2 weeks at that time. I started getting checkered black boxes all over my screen and would just get black screens while my computer was still on and i could still hear audio, i fixed this problem by installing older drivers. With the old drivers the checkered black boxes stopped but my computer was freezing 15 seconds into starting up and getting to my desktop. So windows 7 installed older drivers(WDDM) and it fixed the freezing, but i started getting these random dots(i am unable to screenshot them) which are different color on every webpage, on every video i watch(other than .mkv HD videos), and in games. I have tried doing all those in safe mode and i have no problems at all. So i thought it might be heat my GPU runs at 55-58C idle so i didn't think that was my problem, but my CPU runs at around 48-52C idle, i tried replacing the thermal grease on my cpu and it really didnt do much, after replacing my thermal grease i started to get a boot error after my motherboard logo saying: Disk Boot Failure, Insert System Disk and Press Enter. It would not let me boot up unless i had my windows disk in my cd drive, so i reformated back to windows xp and am still getting the same problems.

The 12V voltage is a little low but unless it fluctuates lower shouldn't be the source of the problem. As a side issue, you might want to check what voltage your RAM requires. A Corsair model I looked up with the same specs as yours calls for 2.1 volts. Your mobo is set to 1.86V. I mainly wanted to check the 12V voltage output but that doesn't seem to be the problem.

Because there is less stress or demands on the graphics card. You make a reasonable point though but if it's not the card, the driver would be the logical suspect but you already installed various drivers which didn't fix it. Let's work on the driver again then.

Make sure you uninstall your old driver (not through device manager) before installing a new graphics driver. Since Windows 7 is fairly new, you should be using the latest Windows 7 compatible graphics driver. Go to the Nvidia website to download it.